Unemployment hits 6%

The rate of unemployment has hit six per cent, up from 5.6 per cent from the previous quarter, according to the Office for National Statistics (ONS).

The ONS confirmed unemployment levels have now reached 1.86 million after another 137,000 people became jobless over the three months to October.

All sectors showed a fall but the heaviest casualties were in the finance and business services industry, which has shed 72,000 jobs since July.

Young people have also been disproportionately affected in the downturn.

Unemployment for 18 to 24 year olds was 597,000 in the three months to October 2008, up 55,000 from the previous quarter.

The number of vacancies has also plunged, with 562,000 jobs advertised in the period – 118,000 fewer than last year.

Alan Tomlinson, at insolvency practitioner Tomlinsons, said: “Today’s figures show just how serious things have become. They are a manifestation of the growing number of corporate failures and cost-cutting strategies resulting from loss of business, sharp drops in turnover, increased bad debts and weaker pricing.

“Being out of work, even for a few months, is going to place considerable pressure on many people’s finances, especially as they can no longer use their properties as a cash machine.”

Employers across all sectors have announced redundancies as demand slows and analysts believe the situation will continue to worsen into 2009, with some predicting unemployment levels to hit three million.